Friday, July 03, 2015

1,891 workers in Malaysia are allegedly no longer employees of CIMB. They have allegedly been let go under a MSS(Mutual Separation Scheme), or what would have previously been called a VSS (Voluntary Separation Scheme).

How voluntary was it? Well, there have been cases in the past where workers really did not have much of a choice, i.e. accept the MSS/VSS or later you will be laid off (or retrenched). These MSS/VSS schemes may sometimes be offering a higher pay-out, compared to the existing termination or lay-off benefits in employment contracts or Collective Bargaining Agreements(CBA) - and, as such really employees have not much of a choice in the matter - accept the proposed VSS/MSS or later still be retrenched.

The validity of this 'voluntariness', alleged 'mutual agreement' have resulted in many cases in the past being workers who allegedly agreed to such schemes, and as such, we should not speedily come to any conclusions...

“Now, we have a lot of cases where an employee accepts VSS and then
takes the company to court,” Shamsuddin [Malaysian Employers Federation(MEF) executive director Datuk Shamsuddin Bardan] said when contacted. - Malaysian Insider,1/7/2015

...there were many cases where workers were made to
choose between two unpalatable options in so-called VSS schemes.

Gopal [Malaysian Trades Union Congress secretary-general N. Gopal Kishnam] cited a case where workers at a factory were given two choices:
either sign on to a new employment agreement where they will no longer
be union members or take the company’s VSS.

“Staying on with the company is even worse because there will be no
union to protect their interests and their welfare will not be covered
by a collective bargaining agreement.

“So can you call something like this voluntary? In such cases, the
remedy left to the worker is to take the VSS offer and file a complaint
at the industrial court.”- Malaysian Insider,1/7/2015

Now, if an employer wants to 'reduce employees', the law provides for certain legal requirements - like the LIFO(Last In First Out) principle, the obligation on the employer to try to place the worker in another position within the business establishment before letting go the worker, etc.. but if it is a VSS/MSS scheme all these do not apply - and the rights and requirements in law can be simply avoided.

“Unlike a retrenchment scheme, you don’t have to inform and justify your reasons to the ministry with a VSS and MSS scheme.” - Malaysian Trades Union Congress secretary-general N. Gopal Kishnam

Was it really there was no more need for the said employees - because no more work? Or was it really a move by the company to get rid of 'REGULAR EMPLOYEES until retirement' and replace them with short-term contract employees, or even 'workers supplied by third party contractor[the Contractor for Labour] - which means these new workers will no longer be employees - so no more employer obligations - and these new supplied workers cannot join the union the said employees of the bank are now in'.

In short, was the move by CIMB really a 'Union Busting' exercise - weakening of the Union by effectively reducing Union members?

Workers who were enjoying the rights as 'Regular Employees' (job security until retirement age) now will find themselves in a most precarious situation.

They are out there in the market looking for jobs, and they will be joined by the 6,000 from MAS on 1/9/2015, - and will they be able to get regular employment ....or will they end up with precarious employment? The later most likely. Will they be able to get employment that pays the same wages and benefits - or will they all now all end up with precarious employment with lesser wages and benefits... and 'worry & stress' about finding new jobs when their contract ends?

Now, most Malaysian worker, based on the fact of being 'regular employees' which was secure, and wages/benefits that were bound to increase with length of tenure would have made decisions to purchase homes, cars, etc... and the obligation to make these monthly payments will not lapse just because they are 'jobless'...or the obligation will not change because their 'income' has dropped..., will it now?

It is sad that media seems more concerned about employer business - rather than the future wellbeing and welfare of these workers and their families - which was once 'stable' but have now become most precarious.

Malaysia still does not have a scheme to assist workers that find themselves 'unemployed'. Thailand already has such a scheme that will enable the unemployed some income for a certain period until they find new employment and income. MTUC has called for such a scheme for workers - but Malaysian government has still not done anything...

These MSS/VSS scheme may be attractive for some workers because they get a 'lump sum payment' ...but alas it will be gone soon enough, and at the end of the day they will find themselves in some 'precarious employment' with no security and guarantees. With the amendment of retirement age law, regular employee would have been assured of employment and income until 65... but now, the employers will really not be so interested in hiring 'senior' workers, would they?

Now, if the worker has been 'forced', tricked, deceived, etc to sign these MSS/VSS, workers can take their claim to the courts - and interestingly, we see the Malaysian Employers Federation(MEF) seem to be calling for this right to do so be extinguished...

It[ Malaysian Employers Federation] proposed, among others, that workers should not be allowed to take
their employers to court if their dismissals were not related to
misconduct. These types of dismissals include lay-offs because of company
retrenchment, or if the business ceases operations and dismissals due to
voluntary or mutual separation schemes (VSS and MSS)...- Malaysian Insider,1/7/2015

Access to justice for workers should never be denied... let the Courts consider the facts and arguments and decide...

The question that also should be asked is whether really CIMB has no more work for these 1,891 workers... or is this letting go of workers really for some other reason? Unions and employees can assist employers having financial difficulties by agreeing to 'pay cuts', delays in payment dues, and other ways, and as such employers should never hastily elect to just get rid of employees - Workers and their families welfare and livelihood should be a paramount concern for employers. Even if there is a need for retrenchment, employers really should endeavor to re-hire laid-off employees when their business start doing well again...this would be just and right.

CIMB Group to incur RM443m from separation scheme

Wednesday, 1 July 2015

KUALA LUMPUR: CIMB Group Holdings Bhd and its Indonesian arm PT CIMB
Niaga TBK, which have completed their mutual separation scheme (MSS)
exercise, will incur about RM443.3mil in MSS cost.

CIMB said in a statement on Wednesday that savings from the headcount
reduction was estimated to be RM291.6mil per year, which translates to
an 18.2 months’ payback.

The group approved a total of 3,599 applications (1,891 from Malaysia
and 1,708 from Indonesia), representing rationalisation of 11.1% of the
total workforce in the two countries.

The country’s second-largest lender announced its first-ever group-wide
MSS, which was voluntary, in mid-May to improve its efficiency level.
The deadline for all applications for the MSS in Malaysia was May 29.

“The MSS was introduced as part of our continued efforts to enhance
efficiency and productivity within the group. With the completion of the
MSS, we are on track to meet the targets set in our cost-to-income
plans outlined in our T18 strategy,” said CIMB Group chief executive
Tengku Zafrul Tengku Abdul Aziz.

“The MSS exercise has also benefited successful applicants and I would
like to thank them for all their contributions and wish them all the
best in their future endeavours.”

The CIMB group is present in nine out of 10 Asean countries, but the MSS exercise was not implemented outside the two countries. - Star, 1/7/2015

11MP to help employers, termination of workers made easier, unions squeezed

BY SHERIDAN MAHAVERA

Employers
are expected to find it easier to hire and fire workers under the 11th
Malaysia Plan when the relevant legislation is amended, which would
delight the business community but is causing chills among unions as
they say it will weaken employeees’ ability to collectively bargain with
their bosses.

According to Chapter 5 of the 11th Malaysia Plan titled “Accelerating
human capital development for an advanced nation”, legislation will be
enhanced to meet labour market requirements.

The text in the 11MP explicitly states that amendments will be made to
the Employment Act 1955, Trades Union Act 1959 and Industrial Relations
Act 1967, laws that have governed worker-paymaster relations for over
five decades.

The report states that amendments to labour-related laws will “address
the rigidity of existing dismissal processes” and “resolve overlapping
and contradicting provisions as well as increase flexibility in working
hours and registration of trade union membership”.
Although the Human Resources Ministry, which is tasked with amending
the laws, has not announced what these specific amendments would be, the
Malaysian Employers Federation (MEF) has given an indication of what
they could contain.

MEF wish list

MEF executive director Datuk Shamsuddin Bardan said that before the
11MP was finalised, the federation had submitted proposals to the
Economic Planning Unit on what employers hope will be in the plan.

The MEF’s members comprise about 5,000 companies and 22 trade associations.

It proposed, among others, that workers should not be allowed to take
their employers to court if their dismissals were not related to
misconduct.

These types of dismissals include lay-offs because of company
retrenchment, or if the business ceases operations and dismissals due to
voluntary or mutual separation schemes (VSS and MSS).

“If a company ceases operations, where is the misconduct in that?
Workers who are retrenched should accept the termination benefits and
move on.

“Now, we have a lot of cases where an employee accepts VSS and then
takes the company to court,” Shamsuddin said when contacted.

He said the current law where workers can take their employers to court
over any form of dismissal was affecting investor confidence in the
country.

“We need the laws so that employers can adjust to the times, so that businesses can survive and remain viable.”

The MEF also wants the process of resolving cases at the Industrial
Court to be sped up, and the amount of compensation awarded by the court
to workers to be reduced.

“We think that cases should be wrapped up in a year because the longer a
case goes on, the harder it is to bring in witnesses,” said Shamsuddin.

Currently, the Industrial Court can award a maximum of 24 months of
back pay to a worker who wins a case, but the MEF wants this cut down to
12 months.

Not voluntary

Malaysian Trades Union Congress secretary-general N. Gopal Kishnam said
unions have already been bracing for such changes to these laws, which
they fear would weaken industrial workers’ ability to collectively
bargain with their employers.

If adopted by the government, some of MEF’s proposals, especially on
the reclassification of dismissals, would further weaken the union
movement, said Gopal.

For instance, he said, there were many cases where workers were made to
choose between two unpalatable options in so-called VSS schemes.

Gopal cited a case where workers at a factory were given two choices:
either sign on to a new employment agreement where they will no longer
be union members or take the company’s VSS.

“Staying on with the company is even worse because there will be no
union to protect their interests and their welfare will not be covered
by a collective bargaining agreement.

“So can you call something like this voluntary? In such cases, the
remedy left to the worker is to take the VSS offer and file a complaint
at the industrial court.”

The umbrella body of private sector unions suspects that companies are
resorting to more and more coercive VSS and MSS schemes such as the one
above in order to shed workers or bring down salary costs.

“Unlike a retrenchment scheme, you don’t have to inform and justify your reasons to the ministry with a VSS and MSS scheme.”

The end result with such practices is that more and more workers are forced to give up their rights to unionise, said Gopal.

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